Finance Leasing Manual - FLM4.21

SSAP21: finance lessee's position from 1984

The finance lessee is required by SSAP 21 to show:

• the leased asset as its property in its balance sheet even though it doesn't legally own it; and

• the capital element it is due to pay in the rentals (the 'loan') as a liability in its balance sheet.

This should make it clear to the world at large just how much the lessee has borrowed.